Canada's national currency is called the Canadian dollar (CAD), denoted by $. Residents and visitors often use coins and paper money, but Canada is also considered one of the most favourable countries in the world for cashless payment methods. It is recommended to have $20-40 on hand just in case, and most transactions can be done with a card.
What Authorities say about cash payments in Canada
The Financial Consumer Agency of Canada notes that using cash is one way to pay for goods and services. Most retail outlets accept cash as a form of payment. Some outlets do not accept cards.
Some people prefer to pay in cash because they do not have to provide their financial information, such as card numbers. However, there is a disadvantage: if cash is lost or stolen, it is unlikely to be returned.
Advantages of using cash versus a credit or debit card:
- You can't spend more than you have on you.
- No interest on payments and no unnecessary fees.
- Sometimes, sellers discount you as they don't have to pay a commission for accepting transactions.
It is recommended that you keep all receipts for purchases in case you need to make a return.
According to a Bank of Canada study on payment methods, cash has declined as a market share in retail transactions. A key factor has been the increased use of cards, especially contactless cards. However, the percentage of cash in retail purchases is changing slowly.
ATMs remain the primary source of CAD cash for residents and visitors.
About the Canadian cash dollar
Today's Canadian currency has been in existence since 1870. Before that, various currencies were used throughout the country, including the British pound, the American dollar and the Spanish peso.
1 CAD consists of 100 Canadian cents.
The money was once pegged to the value of the British pound, as the territory was a British colony, then to the price of gold. Today, it is a "floating" currency whose value is determined by the market.
There are five Canadian coins in circulation:
- 5 cents
- 1 cent
- 25 cents ("quarter")
- 1 dollar (Loonie)
- 2 dollars (Toonie)
Some coins, such as the one cent, are withdrawn from circulation because they cost more to produce than they are worth. Canadian coins are produced by the Royal Canadian Mint, which approaches the process creatively.
Canadian banknotes are created from a thin, flexible polymer. They are much more durable than paper notes, which were phased out in 2011. The denominations of the notes are: $5, $10, $20, $50, $100.